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Nightly Business Report

News/Business. (2013) Investors retool their 401(k)s as markets hit a peak; apparel factory in China. New. (CC) (Stereo)

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PBS

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00:30:00

RATING
G

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Richmond, CA, USA

SOURCE
Comcast Cable

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Channel 41 (327 MHz)

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mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
720

PIXEL HEIGHT
480

TOPIC FREQUENCY

Us 5, Washington 4, Sutherland 3, Tyler 3, Phil Lebeau 2, Hampton Pearson 2, Paul Ryan 2, Steve 2, U.s. 2, Sotheby 2, S&p 2, Sec 2, Sharon Epperson 2, Scott Cohn 2, Blackberry 2, Vatican 1, Costco 1, Pfizer 1, What H & R 1, Hampton 1,
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  PBS    Nightly Business Report    News/Business.  (2013) Investors retool their 401(k)s as  
   markets hit a peak; apparel factory in China. New. (CC)...  

    March 12, 2013
    6:30 - 7:00pm PDT  

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go to the wild kratts website. at pbskids.org. we'll see you there!
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>> this is "nightly business report" with tyler math son and susan garrett. >> battle of the budgets. hoes first up, house republicans say their plan saves nearly $5 trillion. the white house says the math doesn't add up. >> another record bear le upon the dow inches high tore another all-time high and the s&p 500 snapped a seven-day winning streak.
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>> and the unfriendly skies. how frequent flier programs are changing. fasten your seat belts and make sure you're locked in and upright for this. ♪ >> good evening and welcome to our public television viewers. after days of having the focus wall street, today it shifts to washington. >> it sure did, tyler. there's an escalating budget battle waging in the capital after house republicans unveiled their latest federal budget proposal today with plans to slash the country's massive deficit and get government spending under control all without raising taxes. as senate depp democrats prepare their own budget plan, can congress and the president reach a bipart san budget compromise any time soon in hampton pearson takes a look. >> house republicans unveiled the blueprint they say balances the federal budget with just spending cuts and no new tax hikes. at the top of the gop list of what's needed to achieve $4.6 trillion in spending cuts over the next decade is to repeal obama care, cut domestic
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programs from medicaid to college grants and require future medicare patients to bear more of the program's cost. gop budget pointman paul ryan once again throwing down the gauntlet to democrats. >> we don't think it's fair to let critical programs like medicare go bankrupt. we don't think it's fair to take more from hardworking family to spend more on washington. >> the obama white house wafrted little time in criticizing the budget, when it comes to reducing the deficit the math doesn't add up and the middle class will pay the price. >> this is the alternative to balance. it results in unfair tax hikes on middle-class americans and it results in undue burden on middle-class americans. >> this afternoon, the president met with senators from his own party, just the details of the budget plan surfaced and that plan will call for $1.85 trillion in deficit reduction and evenly split from tax increases from closing loopholes and spending cuts.
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the white house says the contrasting budget plans and the president's blueprint which will be released in early april with negotiations to follow are a return to what washington calls regular order? while both budget plans are dead on arrival in their opposing houses, tomorrow president obama will return here to capitol hill to meet with house republicans in what the white house calls an effort to engage lawmakers in the budget process. it's also being dubbed his charm offensive. for nightly business report, i'm hampton pearson in washington. >> as hampton pointed out, health care costs were a big focus in the house proposal, coming up, we'll talk to howard dean and journalist steven breaux about proposing costs. the winning streak extended to an a little session in a row. it sent the blue chip average up nearly three points closing at 14,450. that's another all-time high and the nasdaq lost ten points and the s&p down four points ending
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seven straight days of gains. blackberry was the most heavily traded company on the nasdaq today. more than 80 million shares changed hands while above the average daily volume there. shares were off theerly 3% this on a day when pre-orders where the company's z10 smartphone began. some are looking that the product as a potential make or break product for the smartphone pioneer. john ford explains. >> the blackberry, it used to be shorthand for coolest phone in the world. wall street types were obsessed with them and government workers, too. less than four years ago fortune named it the fastest-growing company, and now blackberry is on the ropes with the hopes pinned on this phone, the z10 which customers can pre-order online and come pick up at these at&t stores on march 22nd. >> what happened? the mainly the iphone. when it came out six years ago the iks phone started small, unlike the blackberry and every other smartphone it had a big
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touchscreen and one button in front. now the iphone is the best-selling model in the country and every other popular phone looks a lot more like this than like this. the names to beat in today's phone game are apple and google who together took more than 90% of the smartphone market last holiday season. blackberry managed just over 3%. the company hopes the z10 gets it back in the game, but there are bigger challenges. the new phones won't bring in the same highly profitable services revenue investors have come to expect and it's not yet clear whether blackberry will be able to sell new phones to make up the ground the old phones are losing. >> we don't deny that internationally this has been a successful device, it sold out in the middle east, and sold out in asia. doing very well in europe and surprising a lot of critics and we don't expect the same response in the u.s., but a better-than-expected launch. >> have you ever had a blackberry? >> no. >> did you ever think you would
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get a blackberry? >> no. >> why not? what do you think a blackberry is for? >> nothing negative. i just wanted something unique. >> blackberry hopes that's what this phone will deliver with its corporate friendly security features and new software for sharing photos, videos and apps. >> by next month, t-mobile and verizon will be offering the z10, too, and then we'll see whether blackberry can regain its cool. for "nightly business report" i'm john ford. >> shipments of apple ipads will fall behind the growing variety of tablets running google's android platform for the first time this year as smaller sized devices catch on, ipads are expected to account for 46% of the pad market while devices running android are expected to grow their share to 49%. apple shares down more than 2% again today. big box retailers are at the top of tonight's market focus. walmart's chief financial officer saying it hasn't seen any drop in spending related to the payroll tax increase, though
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higher taxes are showing up as a concern in customer surveys. shares rose fractionally today and they're up about 8% year to date. >> strong earnings from costco up 39% and that's thanks to an increase in quarterly profits and helped by increasing sales and gained market share during the quarter. shares more than 1% to more than $103 a share. >> two dow component pharma stocks headed in opposite directions. continuing the okay to continue the safety and effectiveness of vytorin as the cholesterol-busting treatment. this made by pfizer can cause fatal irregular heart rhythm. merck gained 3% on the day while pfizer lost ground. president obama's nominee to chair the securities and exchange commission says she'll be an investor advocate. mary jo white questioned by senators at her confirmation hearing this morning said that if confirmed the american public
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would be her client and that she would not back off if there was any evidence of wrongdoing at major institutions. >> assuming you found wrongdoing, i think you'd proceed quite vigorously against effectively anyone that you find evidence of wrongdoing on, but certainly financial institutions at the sec, which of course, doesn't have the criminal powers, those consequences are not taken into account before charging decisions are made so that the sec, there's no institution too big to charge. >> white is expected to get the okay for that sec job especially after republican senator tom coburn of oklahoma announced he would aggressively support her nomination. there's not a lot of support for h & r block today after a software snag has delayed the returns for a lot of americans who have already filed their 2012 taxes. sharon epperson joins us now with more. what went wrong here, sharon?
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>> a lot of folks are disappointed that they're not going get refunds as quickly as anticipated. what h & r block is telling us that between february 14th and february 22nd that a number of filers who were applying for education tax credits were unable to do so because of the way they answered certain yes and no questions on the form. these are folks that were claiming the american opportunity lifetime learning credits and 10% of the total returns claiming these credits were impacted according to the irs. h & r block tells us that any problems that occurred with the form, the form 8863 had been fixed and their clients had no immediate action to take and if they wanted to find out when they could get their refund, they can go to where is my refund.org and it can take up to eight weeks and that means they need as much as four to six weeks in order to process the refund. so a lot of folks will be -- >> that's terrible news because a lot of people count on these
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refunds especially students to pay their bills. >> a lot of students and potential students are waiting to apply for financial aid until they get the returns done and that is causing problems and they should go ahead and apply for that financial aid. >> sharon epperson, thank you very much. >> thank you. meanwhile, coming up, how airlines are making it harder for you to cash in on those frequent flier miles and we'll tell you what you need to know. now let's take a look at how the markets around the globe closed this day. ♪ ♪ ♪ >> it's report card time for the nation's 16 largest airlines and regulators say average on-time arrivals during january fell slightly and there were more complaints about mishandled
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luggage, but on the bright side, there were fewer canceled flights and only five reports of tarmac delays that lasted more than three hours. the high marks went to virgin american and hawaiian a airline, rather and pinnacle airlines were often at the bottom of the list. meanwhile, if you're the kind of traveler who racks up airline frequent flier miles, not so far, some big changes are coming and they may make the perks that you get a lot less frequent when you fly. phil lebeau has more. >> reporter: for frequent fliers change is in the air. it's quickly taking more flights and more money to achieve higher status with certain airlines, and increasingly, cashing in your miles for an upgrade or a free ticket is becoming tougher. >> gone will be the days when you're measured by how many miles you fly. hello to the days when you're measured by how much money you spend. >> right now virgin america, jetblue and southwest award
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frequent flier miles based on how much you spend on a ticket and not how far you fly. it's a move delta will also be making next year. so delta frequent flyers who achieve different levels of status after flying just 25,000 miles will eventually need to not only fly that far, but also spend at least their 2500 with the airline to reach the highest level of loyalty, diamond status, you'll need to fly 125,000 miles and spend at least 12,500 in a year. >> now you can't earn based on models flown on cheaper tickets. it will take more expensive tickets to earn the higher levels required for elite status. >> why are airlines making it tougher to become an elite flyer or cash your flyers. blame it on carriers having fewer seats and frequent flies are. you're competing not just with frequent flier, but for frequent
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buyers and that makes it difficult for anybody to be called an airline's best customer. >> meanwhile, if they cut capacity by eliminating flights or using smaller jets, there are fewer seats open for award redemption. remember, airlines are trying to max mriez fit from every seat on every tliet. so getting an upgrade or free ticket will be tougher. >> for the average person, even though they've been trying to save up miles for the low redemption awards they'll have to plan enough to redeem at the medium or the higher level of redemption rewards. >> with frequent flyers holding 9.7 trillion unused miles, there are plenty of people with plenty of miles. in pack, it's estimated 307,000 frequent flyers have at least 1 million miles in their account. phil lebeau, "nightly business report," chicago. >> flying those friendly skies. earlier in the program we reported on congressman paul ryan's gop budget proposal which
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takes aim at spending. he spent sen months putting u.s. hospital bills under the microscope to find out why health care american style costs so much. his findings are in the march 4th issue of "time" magazine. howard dean is a physician who during his six terms in office kept costs in check. gentlemen, welcome. i look forward to this conversation. >> thank you. >> you spent 21,000 words, longest article in "time's" history. it was an amazing piece with some amazing reporting in it, but i'll ask you to boil those 21,000 words down to about 20 and tell me why you think principally health care costs as much as it does. >> i think i can blow it down to four words. the price is too high and the reason the price is too high is there isn't a free marketplace. the typical health care consumer whether it's the person who is uninsured or even the largest of the insurance companies doesn't
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have the leverage in the marketplace. we live in a world where we think this is a free market. we like everything to be a free market in this country and there is no free market when you go to the emergency room. there is noey from market when you have to buy a cancer drug, and i'm sure that governor dean will testify to that from his experience. >> governor dean, let me ask you that question in a different sort of way. in so many industries we've seen costs trend down over time and the price we used to play for a flat screen tv or for a cell phone, those prices are a fraction of what they used to be, but not so in health care. why is health care different? >> the more facility you had to deliver the higher the price goes. the problem is that the fee for service system that we have encourages us to spend as much as we possibly can. we only get paid, we get paid when someone is sick and we don't get paid to keep them well and in order to fix this problem you have to do away with the
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current way we pay providers and pay them by the patient and not by the procedure and until that happens it doesn't matter what kind of supposed health care cost control you have, it's not going to work. >> i would like you to pick up on what the governor just said, but also address one of the things i found fascinating in your article. a lot of the political conversation lately has been about raising the eligibility age for medicare. you argue conversely that if we really wanted to reduce overall cost and though not the kind of government pays you would lower the eligibility age for medicare. explain why and what you think the effect would be. >> it would reduce the cost that the government is going pay under obama care, too. the only efficient buyer of health care is medicare and if you moved more people into medicare and away from either not having insurance or using the insurance companies that they have they would be paying a
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premium to medicare that would be much liss because medicare's costs are a fraction of what everyone else is forced to pay. the reason being that medicare a lobe has the market leverage to buy health care at a reasonable price, and it's sht a matter of moving people away at fee for service and the way you do that is you have a balanced market or you have to intervene in some way in that market. >> governor, steven keeps talking about market forces so let's talk about the market and the role that the consumers and the american people can play in all of this. do you see that the health care industry is going to bring the consumer along or are consumers going to be pushing for the changes whether it's on price or any other innovation? >> first of all, i don't agree with steve about putting people in medicare. i do think it's a good idea for putting people in the lower age
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because it's true they're a lower cost provider and they're efficient. the problem is their costs are out of control, too. as long as you pay us to do procedures we'll do a lot of procedures and that is the fundamental problem. i think it's great if you put people over 55 into medicare instead of 65. it's cheaper for the insurance companies and the government pays more than 4% instead of 20%, but that is not the ultimate solution. it does not work because you simply pay us to do as much as we possibly can. as long as you have a system that does that, it doesn't matter what consumer pressure is on. they can buy insurance well. they can't buy health care well. >> the fact is though, you're talking about one aspect and what the doctors do. if you talk about the cost of drugs, and the cost of durable medical equipment and the cost of so many other things and just to stay in the hospital room. you really have to get away from a situation where it's a seller's market and a seller's
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market only. i think you have to do both, but i think you have to start by looking at the prices which is what i did with this article. the simple fact is that we live in two economies in this country. all of them lived in one economy which has had a lot of trouble over the last decade and then there is the medical economy which has been booming, just going hog wild booming, and the reason, there is no con proehl on the profits and the prices, and i don't come from -- i'm a left-wing perspective. i look at it from the standpoint of the consumer which & they have no leverage under the marketplace. >> under the obama care there is hope for this because they'll be big nufr, how health care is the unit price. they all have to be built by the patient. >> i'm not sure we solved it, but we made a veiliant effort
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and i hely recommend steve's piece and it is one of the best things i've read on the spiraling cost. court tv founder and former governor howard dean. >> coming up, catholics around the world waiting for a new pope. why it would be beneficial for him to be a man of god with a head for business, but first, let's take a look at how treasurys, currencies and commodities fared today. >> on the radar for tomorrow we'll learn how retailers coped in february given higher gas prices and higher taxes, eating into consumers' wallets and the weather, "the business round table" releases its ceo survey
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of expectations for the economy and we'll get a report from speaker boehner about the president's lunch date with house republican sfoos looking forward to that one. the market for high end art forgery is a $5 billion a year illegal business. with that kind of money at stake, a recent crackdown on selling phony works of art has come up with some surprising results. scott cohn has more. what is a miami pastor with his own you tube channel doing in a manhattan courthouse charged with a temped grand larceny for trying to pass off half a million in counterfeit art. >> how does a pastor get into the art-selling business. >> 45-year-old kevin sutherland wouldn't say and his lawyer says there's a logical explanation. >> the truth will come out and we are confident in our position. >> sutherland pleaded not guilty to charges he tried to pass off these paintings by british artist damian hearst to
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sotheby's in new york even though he knew they were fake. sutherland closed the deal at this hotel not knowing the person across the table was an undercover new york city detective. cyrus vance who prosecuted art fraud cases as a young assistant is cracking down. >> the same art's being stolen the same way as it has been stolen from generations. now our tools to build cases are more sophisticated than they were 30 or 40 years ago. robert whitman who founded the art crime team and now works for private collectors says even with mod eaern technology these cases are tougher than they seem. >> you have to prove knowledge that this person knew the material was fake and that he meant for it to be sold and he was trying to pull the wool over somebody's eyes. >> these are some of the damian hearst paintings that sutherland tried to pass off even after prosecutors say sotheby's specifically told him in an email that one of these spin paintings was not authentic.
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sutherland allegedly told investigators he didn't really read the email. he's due back in court next month. i'm scott cohn for the nightly business report. >> one of, if not the greatest art collections belongs to the vatican. the magnificent frescos by michelangelo, the cardinals cast their votes for a new pontiff. the black smoke signaled no pope was selected. earlier today the cardinals filed into the chapel singing for the saints to help them make their decision. there can be as many as four votes in a day when one cardinal receives two-thirds of the vote, tyler, he becomes the new pope and you know what's interesting about all of this it's not like they're looking for a spir inch all leader and this is almost like a ceo search and the vatican has this vast empire and it has a lot of the same issues as any other vast empire. financial transparency and budget issues and deficits and all of those things we talk about. >> they have real estate and billions and billions served as customers around the week. >> and it's an economy unto
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itself if you looked at that time that way. we have facts here that we'll point out just what we're talking about there. $7.5 billion in the vatican accounts and it doesn't rank among the largest banks in the world, but it certainly has global sweep. >> they also have a mini hedge fund cha is conservatively invested which means they might have missed out on some of the stock market rallies. >> i suspect maybe they have. >> that's it for our "nightly business report" for tonight and this is the time of year your public television station that makes nightly business report possible. >> on behalf of the station, thank you for your support. good night, everybody. we hope to see you right back here tomorrow night.
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